March 2014 - Hybrid Dashboard Report

I have heard the same. They are going off of things they hear such as how much oil we now produce. But energy independence doesn't truly happen until you are free of world market influence (ie. off grid/solar/wind living with an EV).

 

I think there is some cognitive dissidence here. If you are hogging a resource and don't want it taxed correctly then you tend to focus on the stories that the government is fully taxing it, and there is plenty of the resource. All the US has to do is "drill baby drill". When gas prices spike they blame the government, and in reality they are partially correct, the government by keeping federal gas taxes low have encouraged them to buy guzzlers. Federal gas taxes were last raised in 1993, inflation since then has been over 60%, and no fuel tax has been raised to pay for the two oil wars, let alone infrastructure. Infrastructure (roads and bridges) is partially paid through income taxes and more and more through deficit spending.

The technical advances that is producing more north american oil and natural gas is a great story, and we should not discount it. North America could be a net exporter of distilled products and lng. It won't end the drain to the economy though from people wasting so much oil in their SUVs and trucks, but it will provide enough for those that have real needs for these vehicles.

 

same people that complain when the fed won't dip into the gas reserves.

 

Next time you encounter one of these guys, assuming you have a smartphone or other device handy, show them pages like these and have them do the math about the "proved reserves" in the US divided by our daily oil consumption.

Oil: Crude and Petroleum Products - Energy Explained, Your Guide To Understanding Energy - Energy Information Administration
Countries - U.S. Energy Information Administration (EIA)
The World Factbook

Have them prove their side by them giving figures on daily oil production in the boom areas vs. our daily consumption and net imports. I bet they won't have any figures...

 

You talking about Petroleum Reserves | Department of Energy ?

If yes, have them divide the 727 million barrel figure at Petroleum Reserves | Department of Energy by the 7.393 million barrels/day we net import at Oil: Crude and Petroleum Products - Energy Explained, Your Guide To Understanding Energy - Energy Information Administration.

Oh yeah, have them compare the 727 million barrel # to The World Factbook.

 

With so much effort being taken to undermine the plug-in model by misrepresenting & misleading about it, that continues to confirm itself as a wise choice. The resulting confusion & assumptions is something we are constantly having to deal with.

The market isn't ready anyway. Even without the anti-plug rhetoric, there are still challenges to overcome. Look at the struggles with charging-stations. Their variety of issues make them a mess. Cost is obviously another big problem. Batteries are still too expensive to be competitive.

We'd like wider availability. But focus on increasing demand in established areas makes more sense. There shouldn't be any argument that figuring out how to grow sales there, rather than just spreading inventory, is the better move. The need is to actually penetrate deeper into the market, to overcome initial interest.

Look at what GM did with Volt. Drawing in sales from consumers other than early adopters has proven to be much harder than expected. Now, they are stuck without a next step available. What incentive is there for a dealer to offer more and for a salesperson to show more? The market is already saturated.

Like it or not, Toyota's response is a good business decision.

 

I called Piercey Toyota asking them how much a Prius Plug-in Li-Ion battery would cost, parts and labor. I recall they told me about $10,000.

Is this about right?

 

Doubt it. When the Volt arrived, the guess at what GM paid per kWh was in the $600 to $700 range. So a PPI pack would cost $3500, maybe $4000 to jack the customer. Since it isn't an everyday job, the labor might run up, but not $6000 worth.

That's with 2010-11 prices. The end of 2013 it was around $500 kWh, and still dropping.
Li-ion battery prices still headed way, way down, to $180/kWh by 2020

 

Cost to toyota in japan would likely be $2700 or less ($600/kwh). By the time the waranty runs out the cost to toyota likely will be much lower. Price for a dealer to install is up to toyota, they easily may be charging $10K or more. The battery in the next generation is likely different, so toyota may want to charge even more if it doesn't want to sell plug-ins.

 

This may be one of the problems with hybrids. After hitting the market in 1997, there still are very few SUVs sold, and the hybrid trucks are being discontinued. If hybrids are going to get a more significant portion (20%) of the market, they need to push further into these segments. There is some hope. With the new cafe standards there are large incentives to make hybrid suvs and trucks post 2020, which means at least the big boys -> Ford, GM, Toyota are working on this now.

+1

We seem to have quite different world markets. If you look toward Europe, they have favored diesels (high fuel taxes, but lower taxes for diesel than gasoline, until recently allowing large amounts of diesel pollution). There you see many diesels as daily drivers. In the US the equipment needed to follow regulation seems to favor hybrids versus diesels, but low fuel taxes leave people driving many cars that use a great deal of fuel.

 

Bob Lutz quotes +$10,000 for a clean diesel in USA vs. gaso equivalent.
In VA we have reduced gaso tax to 11 cents but we have very high car tax....in NoVA you would pay 20-30% car tax on that incremental +$10,000 to buy the diesel. Quite a few states in the 15-18% range on car taxes, so not as bad as north VA but still quite a tax hit.

These car tax numbers above I have in a letter to VA governor's office, basically I am saying clean diesels, etc make no sense here in VA. But more generally, it goes beyond VA.

 

Lutz is exaggerating the price difference in 3/4 ton pick ups. For the F250 it is $8500 for the diesel. Which is a massive 6.7L V8 and requires upgrading the transmission to handle its output, and is intended for hauling and towing more than passengers with some luggage. The F250 gas trims range from $31k to $54k, so these aren't cheap vehicles to begin with.

For cars the difference ranges from $1300 to $6000. It depends on which trim of gasoline powered one is chosen for the comparison. The Passat TDI is nearly $6k more than the Passat S, but the TDI is a SE trim. Which would only be a $1900 difference.

In relation to property taxes, people buying a diesel car aren't going to be paying on a $10k difference. The tax will be less. However, diesels tend to hold their value compared to a gasoline version. So they'll end up paying more than what the initial price difference implies.

 

Availability and price of diesel are still a hold back for me.

 

I wonder what's going on with the refinery. Is it taking more energy?

 

Bob, refiners are heavily and badly regulated, controlled by a small group of companies. Refineries often have razor thin profit margins. The spread in price between brent and north american oil allowed some big short term profits as US refineries exported refined products (mainly diesel) made with less expensive oil. That spread is not always there, and east coast refineries that can't refine lower grades of oil have been closing because they are unprofitable. The profits are in the midwest and gulf coast refineries, with different regulatory schemes. EPA has a big hand in this making building new major refineries look like bad investments versus expanding the old, keeping competition low, so regulators can screw with everything else.

Exxon is a major diversified oil. It often makes money even when it takes refining losses. The price of oil coming from the ground is controlled by a cartel, OPEC, and Exxon profits from Opec pricing.

 

Baytown refinery? there was a oil spill from a tanker, so it couldn't get oil during the clean up. When oil takes more energy to refine, it likely has a lower price because fewer refineries can handle it and the refinery that can like on the gulf coast makes more profit. Refining profits can get hurt if they make long term contracts at high prices and oil drops, etc.